The direct materials budget:A) is accompanied by a schedule of cash collections.B) is completed after the cash budget.C) is the beginning point in the budget process.D) must provide for desired ending inventory as well as for production.

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Chaitanya Gujjaru · Accepted Answer

Final Answer : D, Explanation :  The direct materials budget must not only take into account the production needs but also the desired ending inventory. This ensures that there is enough inventory to support production while minimizing excess inventory costs. The direct materials budget is an essential part of the master budget and must be completed before the production budget.

The direct materials budget:

A) is accompanied by a schedule of cash collections.
B) is completed after the cash budget.
C) is the beginning point in the budget process.
D) must provide for desired ending inventory as well as for production.

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